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Equity Finance

One way to raise cash is by selling an ownership interest or shares in your business. Business owners find investors among friends and family, professional private investors, venture capital companies, the government, through crowdfunding and even by floating the company on the stock market through an Initial Public Offering (IPO). Investors are paid a dividend and benefit from the increased value of the business as it grows but also share the risk if the business fails and do not have any claims on the assets of the business.

In addition to the sale of a direct ownership interest (“equity”) in a company, equity financing can also include selling equity-like instruments such as warrants, preferred shares or loans that turn into shares (“convertible shares”).

To learn more about how equity finance can help your business, contact a BusinessFinance.com.au consultant today.

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